Friday, April 09, 2010

State Budget Impasse Threatens PULP's Future

Each year since 1981, the New York Legislature has appropriated funds to support the Public Utility Law Project of New York (PULP). Although small foundation grants and charitable donations occasionally supplement PULP's funding, the reality is that the State remains the primary source of PULP’s funding.

One of the alarming consequences of the unresolved New York State Budget for 2010 – 2011 is the absence of future State funding for PULP in the budget proposals of the Governor and the State Senate. The latest problems may be more serious than those caused by the chronically late state budgets during the Pataki years, which led to furloughs and serious hardship for PULP and its employees.

This year, the financial situation is particularly dire because:
(1) PULP's funding has been frozen for nearly a decade;

(2) The purchasing power of the grants is less than half of what it once was; and

(3) There has been a commensurate reduction of staff and resources to work on behalf of New York's needy utility consumers.
In fact, in 2009, due to the inadequacy of the long frozen budgets, PULP halted contributions to its employee pension plan and undertook other austerity measures.

What is the real impact of PULP’s funding crisis for New Yorkers? In a nutshell, if the State does not fund PULP at a sustainable level, New Yorkers will lose the ability of PULP to participate fully in many important proceedings on behalf of low income energy and utility consumers. Without energy and utility service, low income families will go without light and heat and the ability to contact emergency services, any of which may lead to homelessness and other hardships.

Despite its reduced staffing and resource limitations, PULP has continued to make significant contributions, for example:
  • Reforming practices and policies causing hardship and displacement of low income tenants when submetered electric service is provided by their landlords;
  • Winning reconsideration of New York State Public Service Commission (“PSC”) plans for the addition of a new area code in the 315 area, avoiding unnecessary expense and inconvenience for over one million people;
  • Providing daily guidance to consumers and advocates across New York State on enforcement of Home Energy Fair Practices Act (“HEFPA”) rights, utility assistance, and prevention of utility terminations.
Since its inception more than 29 years ago, PULP has been instrumental in promoting universal service, consumer protections, and affordability for New York’s residential utility customers, achieving many milestone accomplishments with lasting value. These include:

Home Energy Fair Practices Act ("HEFPA"). This law, and its implementing regulations, is considered a national model utility consumer "Bill of Rights" and is applicable in New York State to 5.6 million residential electric utility customers and 4.1 million residential gas utility consumers. PULP is the architect of the law and vigilantly monitors its enforcement.

Low Income Electricity Rates PULP was an active party in the PSC proceeding and signatory to a global settlement that for the first time established low income rates for the residential electricity customers of a major New York utility. These rates currently provide an approximate $6 per month savings to 240,000 or 9% of its customers, or more than $17 million per year in discounts. Since 2000 when low income rates were established for this utility, almost all of the major residential electric utilities have adopted some form of low income rates.

Low Income Gas Rates PULP advocated in a 2007 PSC proceeding that brought the first ever low income rates to Long Island residential gas customers, and in two proceedings that expanded low income rates for residential gas customers in metropolitan New York and Buffalo.

Energy Consumer Protection Act and ESCO Marketing Regulation. PULP was an active party in the PSC proceeding to implement the 2002 HEFPA amendments to preserve and enhance utility customer protections when customers switch to Energy Service Company (“ESCO”) service, including the extension of HEFPA protections to transactions between residential customers and ESCOs. PULP is an active party in an ongoing PSC proceeding reviewing ESCO marketing practices and advocating more stringent standards.

Reform of Residential Utility Security Deposits and Service Denials to Collect Past Arrears. PULP successfully challenged a major utility's proposal to modify its policies on security deposits, resulting in a PSC ruling incorporating the following provisions: (i) security deposits cannot be assessed against customers who have entered into deferred payment agreements to satisfy arrears; (ii) customers who have not had service in their name within the past 60 days cannot be assessed security deposits; and (iii) a default in a security deposit payment will not automatically result in a default on a deferred payment agreement. The ruling affects any of the utility's 1.9 million customers who fail within its parameters. Also, PULP initiated a PSC proceeding and successfully challenged a major utility's untariffed requirement that applicants for residential service with arrears from a prior account pay, as a condition of service, the full amount of the arrears or $1,000, which many could not afford. In March 2008, the PSC ordered the utility to discontinue this practice. The utility serves 1,311,422 electricity and 1,958,748 gas customers.

Telephone Lífeline Program. PULP is negotiating with a major telephone service provider to improve participation in Lifeline automatic enrollment, and to end restrictions preventing Lifeline-eligible customers with service package bundles from enrolling in the Lifeline program. This would bring Lifeline service to an estimated additional 100,000 customers.

Proceeding to Examine Issues Related to a Universal Service Fund. PULP is a participant in proceeding examining the future of service in high cost areas of the state and discount programs for low income households. PULP is actìvely supporting having Voice over Internet Protocol (primarily the voice services provided by cable companies) and wireless providers contribute to state universal service funds and to expand low income support to broadband access. An estimated 560,000 low-income New Yorkers would benefit from expanded broadband access at affordable prices.

Submetering of Electric Service to Residential Tenants. PULP presently represents hundreds of tenants in low income (Mitchell-Lama and HUD) and other residential rental buildings that have undergone conversion from master electricity metering (electricity included in the rent) to submetering (tenants receive monthly electric bills). Efforts to date have
Consumer Education. PULP publishes a Utility Law Manual as a guide for advocates on utility and energy law issues, available on its website. PULP also conducts training conferences on preventing utility terminations and the rights of utility consumers and develops accredited Continuing Legal Education programs.

PULP Website. PULP maintains an active website with information on topics relating to utility, telecommunications, and energy-related matters. The PULP website is repeatedly cited as a source of information on energy and telecommunications issues in New York State and at the federal level.

PULP EMail News. PULP publishes a weekly E-Newsletter circulated to a growing mailing list of more than 1,200 advocates, legislators, legal services attorneys, clients, former clients, media and other interested parties. The E-Newsletter frequently links to the PULP Network Blog.

PULP Hotline. PULP maintains a toll-free Hotline at 1-800-255-PULP (7857) to provide free consultation to advocates and individual consumers. PULP's target population is the approximately 2.7 million New Yorkers living in approximately 1.5 million households who are eligible for low income Home Energy Assistance and their advocates in local organizations providing social and legal services to them.

Let us be clear: Who else is engaged in protecting the rights of low income utility and energy consumers across the state other than PULP?

Unless members of the New York State Senate and Governor Paterson join in the effort to fund PULP at a sustainable level, the services PULP provides will come to an end in 2010 – and there is no alternative entity which can replace PULP and its vital, independent services.

Gerald Norlander
Executive Director
Public Utility Law Project of New York, Inc.

Larry Rulison, Cuts could pull plug on voice for poor, Albany Times Union, April 13, 2010

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